UPDATE 1-Superior Industries Q3 loss narrows

* Q3 loss/shr $0.48 vs loss/shr $0.53 * Sales fall 40 pct

* Says sales will improve moderately in Q4

Nov 6 (Reuters) - Aluminum wheel maker Superior Industries International Inc (SUP.N) posted a narrower quarterly loss helped by cost cuts and increased production volumes.

The company said its third-quarter results were helped by the return to normal production levels at two of its major customers, Chrysler and General Motors, which emerged from bankruptcy.

Increased demand for vehicles due to the "Cash for Clunkers" program also helped the company, it said.

"Based on orders received thus far, we believe that our sales will show moderate improvement during the fourth quarter," Chief Executive Steven Borick said in a statement.

For the latest third quarter, Superior reported a loss of $12.7 million, or 48 cents a share, compared with a loss of $14.2 million, or 53 cents a share, a year ago.

Sales fell 32 percent to $111.4 million, while cost of sales fell 39 percent to $107.1 million.

Analysts on average had expected a loss of 14 cents a share, excluding special items, on revenue of $106.8 million, according to Thomson Reuters I/B/E/S.

It incurred about $2 million in severance and non-impairment costs, while medical and workers' compensation expenses rose $1.9 million during the quarter, it said.

Shares of the company closed at $13.79 Wednesday on the New York Stock Exchange. (Reporting by Divya Sharma in Bangalore; Editing by Gopakumar Warrier)